INSIDE RETAILING.

Escada `Move' Is A Theory Missing Facts

May 23, 1998|By Susan Chandler.

Rumors are flying that the Escada shop at 840 N. Michigan Ave. is looking to get out of its lease. Real estate wags have it all worked out.

FAO Schwarz, the popular toy emporium, already occupies the third and fourth floors above the Structure store next to Escada. Expanding further to the third and fourth floors above Escada would make perfect sense for Schwarz.

That would leave Escada with a cozy first and second floor space in a prominent corner location near Oak Street that would be perfect for lots of upscale retailers.

All very interesting, but there are no plans to close the Chicago store, says Amy Rosi, Escada's spokeswoman in New York. But she admits, "There are always conversations," and the store may end up being remodeled or revamped.

To a degree, Escada is a victim of its own success here. Just down the street from its boutique, Neiman Marcus sells millions of dollars of Escada's brightly colored, luxury clothing through semiannual trunk shows. The line also is available on Michigan Avenue at Marshall Field's in Water Tower Place and Saks Fifth Avenue.

Those are much more comfortable settings than Escada's boutique, which has an off-putting first floor with high-end scarves displayed in glass cases. To find clothes, customers must climb a curving staircase to the second floor.

Rosi acknowledges that the Escada store in Chicago is not one of the Munich-based company's stellar performers, despite its prime location. But Chicago will be getting some special attention from the company this year. To showcase the Windy City's importance, Escada has slated Chicago to be one of several cities around the world where the company celebrates its 20th anniversary this year.

"We really want to get much bigger," Rosi said.

No sweat: Few retail experts gave former U.S. Labor Secretary Robert Reich's campaign against sweatshops much chance of success when he launched it three years ago. After all, they reasoned, value-driven consumers wouldn't sign on because they weren't interested in paying even pennies more for apparel or footwear.

True enough, but the pessimists underestimated the power of public relations. Big companies like Nike, Gap and J.C. Penney Co. hated being embarrassed by Reich and other anti-sweatshop activists who kept calling media attention to the problems of teenage workers in countries such as Indonesia, Mexico and Guatemala.

Now, instead of arguing that they can't control what happens in Third World factories they don't own, manufacturers and retailers are taking responsibility in far-reaching ways.

This month, Reebok International began marketing its soccer balls, which are made in Pakistan, with a child labor-free guarantee.

On May 12, Nike CEO Philip Knight announced the company would raise the minimum age of footwear factory workers to 18 and adopt U.S. air quality standards for all of its factories. The Beaverton, Ore., sportswear giant also gave its factory workers a raise in early April.

Knight told a gathering at the National Press Club in Washington that he was tired of being called everything from a corporate crook to the Great Satan, and he wanted to set the record straight.

Reich, now a professor at Brandeis University, must be smiling.

Christmas cheer: Somebody had to be the first. KPMG Peat Marwick's May retailing newsletter predicts that Christmas 1998 "should be stellar."

The consulting firm bases that prediction on very strong performances by specialty apparel retailers, discounters and off-pricers during the spring season.

But there's been a serious disconnect between strong spring sales and a good holiday selling season for the past four years. For some reason, shoppers have turned conservative in the critical fourth quarter despite a strong economy, leaving optimistic prognosticators in the lurch.

Peat Marwick's consultants acknowledge that pattern but remain hopeful for 1998. "It would seem the retail renaissance is in full swing. Today's consumer, while still motivated by a good bargain, will spend money," they write.